The linkage between financial inclusion and successful female entrepreneurship is meticulously significant. The concept of financial independence for women entrepreneurs has been a topic of intense interest for researchers, policymakers, practitioners, and other stakeholders. There has been a long-term debate about why financial inclusion is low for women as compared to males around the globe.
The concept of proliferating financial inclusion and independence among women is an important aspect of increasing the economical growth of developing as well as the developed countries. Supporting women entrepreneurs continues to be a prime concern and is a crucial determining factor in assuring their financial access and high-quality formal financial aids. There are several potholes in the provisions of financial independence for female population. Along with the common aids in place, we need to assure that women get an extra edge for the encouragement for their participation in entrepreneurship.
Status of Financial Independence for Women
Several banks are oblivious to the fact that women exemplify the major markets in the world right now. There is little capacity and knowledge in financial institutions about the size of the market, the value propositions to be offered, and the proper segmentation of financial, business, stock markets, etc. There seems to be a prevalent gender gap in financial inclusion. Women are less likely to hold formal financial services such as bank accounts, credit, and loan accessibility than men, globally. According to a survey of 2015, globally, only 58% of women stood steady with their financial services in place as opposed to 65% of men. The persistent breach demands to be filled by the cement of effective strategies for women’s financial inclusions.
How to Promote Financial Independence for Women
Below we have discussed the major issues and the strategies that can help in attaining equivalent data of women’s financial inclusion against men.
Provide Financial Literacy
What proves to be the major concern for the backdrop of financial inclusion among women is the limited literacy regarding the financial aspects among most women. In developing countries, the prevailing low literacy of women takes the superior position, pushing financial literacy to the backseat. In developing countries, the literacy rate is relatively low in general. Diving deeper into this pertaining issue, one finds that the literacy rate of women is even lower than the general public. Talking of the developed countries, there can be reasons regarding the low financial literacy among women such as the ignorance of need.
The breach of insufficiency in literacy can be covered up by educating women in the first place, then making them aware of their rights towards financial services, encouragement through the educational institutions, family support, provision of improvised aids via companies.
Strategize Financial Inclusion of Women
The policymakers, regulators, and other stakeholders can take a few steps ahead of the ordinary financial services to ensure the extensive inclusion of women in the field. Women lack financial freedom than men, globally. To reduce this gap, an extra endeavor from the financial officials’ perspective would be a great initiative. Modification and adjustment in the legal, regulatory and supervisory frameworks along with repealing the constraints in favor of women can prove to be a crucial endeavor. Besides the modification, there should be room for innovative approaches to strategies such as new and creatively designed products and delivery channels.
The collection of gender-disaggregated data to have a clear picture of the needs of the target population is another effective measure that can be implemented.
The issue of women’s financial inclusion concerning adjustment in the framework conditions has been deliberately recognized by the African policymakers and regulatory bodies including the Central bank governors of South Africa, Zambia, and Mozambique.
Recognize the Distinct Needs of Women
We all agree at the juncture that the needs of different women in different areas with different ambitions and areas of interest are significantly different amongst themselves. For this reason, the financial institutions must reconsider the distaste needed arising from varied situations and collaboratively develop measures and strategies that are in the best interest of their women-based consumer markets. While planning and executing new products and services, the responsible institutions must review and take into consideration all kinds of unattended prerequisites of these women consumers. They should back their products and services with the concerning requirements ranging from the micro-entrepreneurial endeavor in need of capital to the massive women entrepreneurs in search of valuable services to organize their capital.
Assistance from Microfinance Industry
In 2011, the Women’s World Banking initiated the Gender Performance Initiative (GPI) to examine how efficiently microfinance is attending to the needs of women. In addition to this, it also aimed to evaluate the privileges of financial inclusion of women and to build the notion that women are valuable customers and employees along with being the catalysts of economic and social growth. Recognition of the priority areas of women’s needs and development of products around those prerequisites, addressing the particular life cycle needs and goals of women, as well as service integrity and client protection, are some crucial measures.
Upgrade in the Position of Women Leaders
The least addressed and discussed question is why women are not holding satisfactory positions of leadership in the financial sector businesses, regulators, and fintech? There has to be a revolution in the treatment of women. There is a need for an extensive number of women CEOs, women board members, and more decisive jobs in women’s hands. This will help in making a sustained effort towards reducing the gender gap. As they say, the world changes when individuals predominantly change themselves, this change should also begin from the roots.
Women with Financial Independence are the Key to Increased Entrepreneurship
Modern societies seem to be clear that the time has come for women to play a more equitable, fair, and prominent social role contributing to the empowerment of both women and the country’s economic, political and social factors.
Campaigns such as #NiUnaMenos in several Latin American countries, #MeToo in the United States, or #HeforShe at a global level are just the echo of change that seeks to balance between men and women, especially in the workplace.
In an attempt to overcome the obstacles that limit the business development of women, the International Labor Organization (ILO) has proposed the Intervention Model for the Entrepreneurial Development of Women that seeks to economically empower women and the growth of their companies.
